Morgan Stanley now 'cautious' on REIT sector

NEW YORK (CBS.MW) -- Morgan Stanley lowered its rating on the real estate investment trust (REIT) sector to "cautious" from "in-line," citing high valuations, continued weak fundamentals, rising interest rates and an improving economy. "While we are not calling for a severe downturn, we believe it unlikely REITs will keep pace with a strengthening broader market over the coming year," the firm said in a note to clients. Within the sector, Morgan Stanley downgraded Cousins Properties
CUZ, +0.33%
Kimco Realty
KIM, -1.29%
and PSBusinessParks
PSB, +0.49%
to "equal weight" from "overweight," and Public Storage
PSA, +0.23%
to "underweight" from "equal weight."

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